Kinross Gold’s Lobo-Marte cost jumps 67% as NPV more than triples
The project, 50 km from Kinross’ La Coipa and Maricunga mines, is to produce about 350,000 oz. a year.
Kinross Gold's projected cost for its Lobo-Marte gold project in Chile has surged by nearly two-thirds to $1.8 billion, despite the post-tax net present value remaining at an estimated $4.3 billion. The project, located 160 km east of Copiapó in the Atacama region, is expected to produce around 350,000 ounces annually for 15 years at a cost of about $1,000 per ounce.
The renewed feasibility study, completed to account for inflation since 2021 and further enhancements of the execution strategy, attributes a significant portion of the cost increase to inflation, equipment purchases, construction planning changes, and higher indirect costs. Despite the higher cost, the project's internal rate of return is estimated at 26% and the payback period at 2.3 years at a gold price of $4,100.
Kinross sees the Lobo-Marte project as central to its grade enhancement strategy due to its low mining and processing costs, high heap leach grade, and substantial resource size. The company plans to issue a more definitive cost estimate after completing detailed engineering.
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